Economy
Commerce Department Shows Strong Services and IT Revenue Trends in 2016
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Most investors and economists pay attention to payrolls and unemployment, gross domestic product, retail sales, consumer sentiment and other major numbers when they evaluate the economy. Still, the United States is now a post-manufacturing economy, and some of the smaller economic readings offer keen insight into the economic picture.
The U.S. Department of Commerce has released its service-sector growth reading for the third quarter of 2016. The report showed that revenue growth accelerated. As a reminder, the third quarter was prior to the election, so none of the November bumps will be part of this report.
Selected services total revenue for the third quarter of 2016, which is not adjusted for seasonal issues, was up 1.6% to $3.5125 trillion from the second quarter of 2016. That figure is up 5.3% from the third quarter of 2015.
Information revenue rose by 1.8% in the third quarter, and the second quarter report was revised to 0.0% from a preliminary view of −0.1%. The more appropriate reading to watch is the annual growth from the prior year, and that was up 4.9% in the third quarter of 2016 from the third quarter of 2015. The prior report was revised to 2.9% growth from 2.8% in the second quarter.
The Census Bureau’s quarterly services survey generally focuses on information and technology services, but there are more services to consider.
In the professional, scientific and technical services, the revenue growth was up 1.2% to $435.5 billion from the second quarter of 2016 and up 4.9% from the third quarter of 2015.
Administrative and support and waste management and remediation services saw a combined gain of 2.1% to $219.5 billion in the third quarter of 2016 versus the second quarter. On an annual number, that was up 7.0% from the third quarter of 2015.
Again, this was a third-quarter report. That makes most of these a look back, rather than being considered as a forecast.
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